Roadmap for Achieving Biogen’s Scope 3 Science -Based Target Master’s project submitted in partial fulfillment of the requirements for the Master of Environmental Management degree in the Nicholas School of the Environment, Duke University, April 2019 1 Madison Barnes Dieynabou Barry Temis Coral Castellanos Jeffrey Meltzer Dr. Deborah Gallagher, Co-Advisor Dr. Jesse Daystar, Co-Advisor 1 Several pieces of confidential business information have been removed or anonymized for this public version.
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Roadmap for Achieving Biogen’s Scope 3 Science-Based Target
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Roadmap for Achieving Biogen’s Scope 3 Science-Based Target
Master’s project submitted in partial fulfillment of the
requirements for the Master of Environmental Management degree in
the Nicholas School of the Environment, Duke University, April 20191
Madison Barnes
Dieynabou Barry
Temis Coral Castellanos
Jeffrey Meltzer
Dr. Deborah Gallagher, Co-Advisor
Dr. Jesse Daystar, Co-Advisor
1 Several pieces of confidential business information have been removed or anonymized for this public version.
2
Table of Contents
List of Figures and Tables ............................................................................................................. 4
a) Biogen-Level Recommendations: Addressing Sustainability Within Biogen ......................... 21
b) Supplier-Level Recommendations: Increase Engagement with Suppliers.............................. 22
c) Industry-Level Recommendations: Foster Industry-Level Collaboration .............................. 24
5. The Business Case for Tackling Supply Chain Sustainability ........................................... 28
a) Biogen’s supply chain emissions surpass its own ....................................................................... 28
b) Economic impact ........................................................................................................................... 28
c) Investors ........................................................................................................................................ 28
a) Climate Change and Science Based Targets .............................................................................. 30 I. An Introduction to Climate Change .......................................................................................................... 30 II. Business Sector Contributions to Climate Change ................................................................................... 31 III. What are Scope 1, 2, and 3 Emissions? ............................................................................................... 31 IV. What is a Science Based Target? ......................................................................................................... 32 V. Setting an SBT .......................................................................................................................................... 34
b) Company ........................................................................................................................................ 37
3
I. Introduction to Biogen .............................................................................................................................. 37 II. Structure .................................................................................................................................................... 38 III. Guiding principles ................................................................................................................................ 38 IV. Materiality Assessment ........................................................................................................................ 39 V. Sustainability............................................................................................................................................. 40 VI. Biogen’s SBT ....................................................................................................................................... 41
Appendix 2: Literature and Industry Review .............................................................................. 43
a) Third-Party Knowledge-Sharing and Consensus-Building Programs .................................... 43
b) Third-Party Organizations to Refine and Implement a Scope 3 Strategy .............................. 43
c) Case Studies from Other Industries ............................................................................................ 43
d) Industry Case Studies ................................................................................................................... 46
e) Industry Resources ....................................................................................................................... 48
f) A Further Look at PSCI .............................................................................................................. 52
Therefore, when Biogen is ready to engage with suppliers on the scope 3 reductions, it must review
the results and apply these methods to the latest available data to update the key suppliers and
categories.
b) Key Suppliers Analysis Using the list of top suppliers described in the previous section, we analyzed the top 25 suppliers
based on GHG emissions and total spend. Thirty-three suppliers fall in one or both categories.
Supplier companies were analyzed based on their CDP Climate Change 2017 submissions and
SBT commitments. The CDP data points that were targeted were Targets and Initiatives (CC3)
and Scope 3 Emissions (CC14).3 For SBT updates, we searched for companies taking action. If a
company did not report, we used a supplier’s holding company or subsidiary as a proxy if available.
We prioritized targets for 2035 if two goals were listed to better meet the timescale of this project.
3 It is important to note that CDP recently transitioned to a new system. CDP 2017 CC3 and CC14 entries map to C4
and C12, respectively. These are the locations that Biogen should look when updating the data in future years. Given
that we only could access default accounts, we had limited access to view a company's CDP report. (To receive
additional access, Biogen could email CDP).
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When CDP and SBT resources were not available, we used information published on the supplier’s
website to fill in any data gaps.
Of the 33 companies studied, all but two report some environmental initiatives, and 21 report to
CDP. Seven mention setting SBTs, or a goal to set a SBTs. Based on what companies report, we
identified those who are likely to form an industry partnership and those that collaborate with
customers. Additionally, we analyzed the companies based on what initiatives they are already
working on. Potential industry collaborators were selected based on companies that were both
active in supply chain engagement/management and whose business focused primarily on
pharmaceuticals and biotechnology. The results are shown in Table 10 in Appendix 3.
One unique aspect to the pharmaceutical sector is the presence of Good Manufacturing Practice
(GMP) suppliers. GMP suppliers face more difficulties in reducing GHG emissions because they
have to ensure to regulators that any modifications to processes or products do not alter GMP
compliance. As shown in Table 9 in Appendix 3, by 2017, Biogen’s GMP suppliers represented
23 percent of its scope 3 emissions. Four of these GMP suppliers are also part of the group of key
suppliers identified with the approach in Figure 4. In general, GMP suppliers could still be engaged
in GHG reduction initiatives, but their results might not be as immediate as other types of suppliers.
Therefore, it is important to engage them early enough to give them time to adjust their products
or processes to Biogen’s requirements.
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4. Recommendations Biogen’s journey to meet its SBT will require a bold stance to affect behavior at every level of
production in the value chain (scope 3). We provide an internal, external, and industry-wide
roadmap that identifies the most critical components to reaching Biogen’s SBT. Our multi-faceted
approach focuses on reducing scope 3 carbon emissions across all dimensions of Biogen’s supply
chain. We recommend Biogen focus on addressing sustainability across multiple scopes: internally
within Biogen, externally with Biogen’s existing and potential suppliers, and industry-wide to
include other competitors, peers, and suppliers.
In each level of scope for addressing the SBT, we provide Biogen three recommendations, one
that can be accomplished most easily, one that will be mildly difficult, and one that will likely take
significant resources to accomplish. Each recommendation is presented below (Figure 7) in order
of what level of scope the recommendation engages and the anticipated level of difficulty. We
based our recommendations on extensive competitor benchmarking, qualitative industry analysis,
and quantitative supplier analysis. Many of Biogen’s competitors are already putting many of these
recommendations into practice, as shown in Figure 12 of Appendix 4.
When considering how to accomplish these tasks, we highly recommend Biogen consider
transitioning an employee to a dedicated position for sustainability programs or creating this
position. This role would provide leadership to projects in multiple departments, such as supply
chain or procurement, that the EHS team alone may not have the bandwidth to accomplish.
Furthermore, this position could help lead Biogen through the complex and important process of
meeting the company’s scope 3 target by adopting any combination of the below
recommendations. In the meantime, Biogen should increase an EHS team member’s hour to
provide this leadership.
Figure 7 Biogen’s Recommended Roadmap to Achieving its SBT.
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a) Biogen-Level Recommendations: Addressing Sustainability Within Biogen We recommend Biogen focus on increasing awareness within the company of sustainability and
carbon emissions reductions. Biogen should also consider adapting internal strategy and corporate
structure to address carbon emissions reductions by increasing awareness among Biogen
employees.
Educate and Engage Employees on SBTs and Emissions
Biogen employees are largely unaware that the company has committed to an impressive and
aggressive SBT. Biogen should take steps to educate employees on its SBT goals and create
sustainability champions among employees by integrating employee education and engagement
into the company’s broad sustainability strategies. This will not only increase awareness and
provide support to initiatives related to SBTs, but can also create allies beyond the teams directly
related to this project. These employees can make decisions that supports the SBT within their
day-to-day jobs. We provide recommendations for specific actions Biogen can take to educate
employees in achieving its SBTs. The recommendations are summarized in Table 1. The full text
of our project and program recommendations can be found in Appendix 4, Supplement 1:
Employee Education.
Table 1 Summary of Employee Education and Engagement Recommendations
Educate Engage
Monthly Lunch and Learns Create a Green Team
Earth Day Activities Healthy Competition
Signage Employee Recognition
Incorporate Sustainability into Employee and
Manager Training
Funding for Sustainability Projects
Create Interactions Between Sustainability and Supply Chain Teams
The next level of difficulty is to create more interactions between the sustainability and
procurement or supply chain teams. Since Supply Chain works with suppliers on a day-to-day
basis within Biogen, they have essential connections and knowledge of how to most effectively
deal with suppliers. The sustainability/EHS team within Biogen should work to educate the supply
chain and procurement teams about what information and interactions with suppliers are beneficial
and could be added to supply chain’s existing conversations with suppliers.
In the past, members of Biogen’s EHS and Sustainability teams have communicated with their
counterparts at specific suppliers. By reinitiating sustainability-related conversations by the supply
chain and procurement teams, Biogen can 1) identify who within the company would be
responsible for carbon-reduction initiatives and carbon emissions information, 2) gather more
accurate emissions profiles for the company’s own emissions as more and more suppliers are
working to reduce their own scope 1 and 2 emissions, and 3) begin to form future relationships
that can be utilized for recommendations outside of the scope of Biogen. We recommend the
sustainability team initiate these conversations and train Supply Chain on how to adopt some of
these responsibilities to integrate SBT-related efforts as efficiently and seamlessly as possible.
Fully Align Sustainability with Supply Chain
Companies that have been successful in aligning sustainability in different departments have their
supply chain and sustainability teams take primary ownership of supply chain emissions reduction
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initiatives. According to a report by EY & UN Global Compact (2016), the procurement team
owns supply chain sustainability initiatives in 47 percent of the 70 surveyed companies, while the
sustainability team owns the initiatives in just 26 percent of companies, suggesting that Biogen
should seriously consider placing the scope 3 goal within the procurement team.
If possible, we advise Biogen takes the integration between sustainability and supply chain teams
one step further; we recommend Supply Chain take on the information gathering and relationship
management with suppliers. Involvement of the Supply Chain team is critical since it has existing
relationships with suppliers and carries out the selection, renewal, and auditing processes. Biogen’s
top suppliers typically have a key
account manager who can liaise with
their internal departments to address
any questions and issues. As stated
previously, Supply Chain already
manages supplier relationships, so
transitioning the supplier engagement
aspect of Biogen’s SBT efforts to
supply chain would be a natural fit.
To get Supply Chain on board, it helps
to have support from senior
leadership, business goals, and
incentives—such as bonuses or paid
time off—to encourage the team to
help meet the company’s scope 3 target (EY & UN Global Compact, 2016; Roberts, 2018). As
stated previously, before engaging suppliers, the Supply Chain team should be aware of Biogen’s
environmental goals, what the company wants from its suppliers, and why the scope 3 goal is
important.
b) Supplier-Level Recommendations: Increase Engagement with Suppliers We recommend Biogen focus on engaging suppliers to reduce their own scope 1 and 2 emissions,
since these emissions are what make up Biogen’s scope 3 emissions.
Gather Important Information from Suppliers
Biogen has already had success gathering some detailed information from a few suppliers. We
recommend Biogen revisit this initiative. Biogen should identify someone within each supplier
company to discuss sustainability issues or to clarify data that Trucost uses in its assessment. In
the past, Biogen has found that suppliers’ actual emissions are lower than those estimated by
Trucost. Once this contact has been established, Biogen should consider sending out additional
surveys to suppliers about what their actual emissions are and what they are doing to reduce them
in the future.
Examples from Other Industries:
Campbell Soups, Mars, ABInBev, and Danone
are a few companies that have integrated
sustainability goals into procurement or even
created sustainability positions within the teams
(Roberts, 2018). To promote sustainability in the
supply chain, Campbell’s, for example, places
people with sustainability experience into
leadership positions in the procurement
department and Mars has recently given its chief
sustainability officer leadership of the
procurement team (Roberts, 2018).
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Surveys signal to suppliers the
importance of measuring emissions
and either directly or indirectly
encourages them to manage the
emissions they must measure for
the survey. Most companies have
chosen CDP Supply Chain,
Ecovadis, Ecodesk, or their own
internal systems to survey
suppliers. See the third-party
resources section for descriptions of
each. If Biogen plans to survey its
suppliers, the Supply Chain team
should be aware of how the survey
works and how suppliers can
complete it.
Other companies find it valuable to
have supplier codes of conduct or
sustainability scorecards for their
supply chain teams to evaluate and
enforce sustainability standards (i.e.
the stick approach). Such a code of conduct could require suppliers to take certain actions to
support fair labor standards, develop environmental policies, operate ethically, and monitor their
progress. A survey of 519 global suppliers by Ecovadis & Affectio Mutandi (2018) found that
customers’ CSR requirements had a positive effect on their organizations: 41 percent of suppliers
responded that CSR requirements raised awareness in their companies and an additional 38 percent
responded that CSR requirements prompted their companies to implement new programs.
Biogen already has two surveys for its suppliers, but neither focus on sustainability or the
environment. Biogen could modify these two surveys—the Scout Questionnaire and the Supplier
Diversity Survey—or it could turn to a new, environmentally-focused survey such as CDP Supply
Chain, Ecovadis, or Ecodesk. Biogen had previously ruled out CDP Supply Chain and Ecovadis
and has expressed interest in using Ecodesk, which many other companies in the pharmaceutical
space already use. Recently, the Supply Chain and procurement teams have begun using Resilinc
for data gathering. Whatever survey it chooses, Biogen should encourage suppliers to measure
their emissions, identify opportunities for improvement, and set their own goals.
Educate Suppliers on Sustainability Initiatives
Biogen can go beyond information gathering and educate suppliers about the financial and
environmental benefits of reducing their scope 1 and 2 carbon emissions. Regardless of the
supplier engagement method, many companies find it important to emphasize their goals and
shared business opportunities (i.e., using rewarding approaches) and to let suppliers decide how to
get there, with or without their assistance (Norton, 2015). This can be conducted similarly to how
Biogen engages and educates employees internally, but with more focus on the general business
case for pursuing energy efficiency and renewable energy projects.
A Further Look at Codes of Conduct:
Codes of conduct can require suppliers to respond to
supplier surveys, report certain aspects of their
emissions, or get a minimum score on that survey. To
be effective in driving the desired impacts, companies
need to monitor compliance of supplier codes of
conduct, and most companies use third-party
evaluators for this task (Ecovadis & Affectio
Mutandi, 2018). Any company that requires its buyers
to discuss sustainability-related issues with suppliers
must provide training to those buyers to raise their
awareness of sustainability and its importance to the
company’s legal and reputational risks (Ecovadis &
Affectio Mutandi, 2018). Heineken provides a good
example of a supplier code of conduct, which it
implemented in 2010. The code requires its suppliers
to sign the code; then perform a risk analysis and
sustainability assessment using Ecovadis, which
provides tailored recommendations; followed by a
third-party audit (Ecovadis, 2014).
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If a company begins its engagement process by surveying suppliers, it can emphasize its goals and
explain how measuring emissions throughout the supply chain can both help meet those goals and
also reduce the suppliers’ energy costs. As mentioned previously, the mere process of bringing up
sustainability topics with suppliers can give them the message that sustainability is important and
could provide the impetus necessary for suppliers to improve efforts in that area, especially if a
company provides a supplier with most of its business. Other organizations find success in
developing platforms or holding conferences to share supplier best practices. Appendix 4,
Supplement 2: Starting Point for Suppliers gives Biogen an example of a communication
instrument that offers a set of recommendations for suppliers that are not familiar with the different
ways to reduce GHG emissions and resources to continue their research.
Support Suppliers in Sustainability Initiatives
The most ambitious practice for encouraging participation in sustainability initiatives include
rewarding suppliers for improved performance and recognizing them for their sustainability
efforts. Meaningful recognition of suppliers can validate their efforts and improve interest and
participation (see case study on Clif Bar, Appendix 2). This can take the form of a CSR clause that
ensures that sustainability efforts are incorporated into negotiations, are included in supplier
assessments, and are discussed throughout the entire agreement. Suppliers that reduce their
environmental impacts could be rewarded with more business or other perks such as longer-term
contracts, greater access to the value chain, company leadership, or preferred supplier status.
However, Biogen should be prepared to terminate the contract if the clauses are breached
(Ecovadis & Affectio Mutandi, 2018).
Biogen should also consider providing financial support to suppliers where possible to help them
improve energy efficiency and procurement of renewable energy that they may not be able to do
alone due to their size or business model. Many companies seeking to reduce their supply chain
emissions have implemented comprehensive supply chain green power programs for their
suppliers. Apple, Clif Bar, IKEA, and BT have set up programs that either provided low-cost
financing or independent energy experts to help their suppliers procure renewable energy (see
case studies on Apple and Clif Bar, Appendix 2).
By building knowledge and financial support of green power internally and throughout the supply
chain, companies can grow corporate demand for renewable electricity in new regions; create
opportunities for collaboration, demand aggregation, and knowledge sharing; and leverage
influence beyond their own power procurement (RE100, 2017). Biogen can find support for these
initiatives by partnering with organizations, such as financial organizations. This is discussed in
the next section.
c) Industry-Level Recommendations: Foster Industry-Level Collaboration We recommend the company expand its focus to include the entire industry by identifying
synergies with other organizations to create joint projects or organizations to maximize emissions
reductions in the entire pharmaceutical-biotechnology industry.
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Identify Suppliers Already Working on
Emissions Reductions for Partnerships
The easiest way to begin to tackle this
recommendation is by expanding on the
recommendations of the previous scope by
identifying suppliers that are already
collaborating with their customers or
working in larger organizations to reduce
their emissions. These suppliers are likely
already aware of the benefits of reducing
emissions along the pharmaceutical supply
chain and have some of the skills and
connections to tackle reductions in their
own scope 1 and 2 emissions. These
suppliers can serve as partners for Biogen.
Biogen should work with these companies
to find collaborative ways to reduce
emissions throughout their shared supply
chain.
By conducting an analysis of how suppliers are already reducing emissions, we recommend
Biogen target the following list of companies. These companies are Biogen’s top suppliers, by
spend and greenhouse gas emissions, that are already working with their customers to meet
environmental goals:
• Supplier 1
• Supplier 2
• Supplier 3
• Supplier 4
• Supplier 5
• Supplier 6
• Supplier 7
Partner with Organizations Outside of the Industry
We recommend that Biogen partner with organizations outside of the pharmaceutical industry to
help reach some of the more aggressive recommendations and goals. Upwards of 70 percent of
companies choose to work with peers, industry associations, and NGOs on supply chain
sustainability programs (EY & UN Global Compact, 2016). Biogen should identify one or more
partners from organizations such as the International Finance Corporation, CDP, or EDF, which
have helped support businesses conducting challenging sustainability efforts.
Certain organizations outside of the pharmaceutical industry are beginning to provide suppliers
with the financing they need to reduce their emissions. Financing can be an obstacle for projects
even if there is a fairly quick payback. This support has become essential for suppliers who want
to reduce their emissions, but do not have the credit history or working capital to make the
necessary investments. These programs are successful because when banks and lenders have the
Example from Another Industry:
To achieve its SBT of reducing supplier
emissions by 40 percent, Levi Strauss is
working with the Partnership for Cleaner
Textiles, Clean by Design Program, and the
Sustainable Apparel Coalition (see case study
on Levi's and the Sustainable Apparel
Coalition in Appendix 2). Similarly, tech-giant
HP created an Energy Efficiency Program
with the help of nonprofits BSR, WRI, and
WWF to encourage over 200 suppliers to
reduce their utility costs and environmental
footprints (HP, 2018). HSBC works with
many CDP Supply Chain Members to provide
capital finance to their strategic suppliers to
make the investments they need to enhance
their sustainability practices (Norton, 2015).
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assurance that these suppliers have long-term relationships with major companies that want them
to reduce their emissions, they are more likely to loan the suppliers the capital to make energy
efficiency or renewable energy improvements.
We recommend Biogen begin this process by forming a partnership with one organization to
support suppliers in the company’s direct supply chain. Biogen could work with an organization
to consider expanding its efforts into a pharmaceutical industry-wide effort, as discussed in the
next recommendation.
Work with other Businesses to Create an Industry Consortium
The most aggressive and far-reaching recommendation is for Biogen to support a collaborative
effort seeking to reduce carbon emissions among suppliers throughout the entire pharmaceutical
industry. One company alone may be less likely to have the needed resources to accomplish desired
programs and projects. Recognizing the limitations of influence over suppliers in its complex,
international supply chain, Biogen must build coalitions and partnerships with other industry
players that share its vision for sustainable pharmaceuticals. Coalitions enjoy greater influence
over suppliers and manufacturers. Economies of scale are more easily achieved, lowering the cost
of introducing any new efforts to reduce emissions. Moreover, coalitions directly influence
suppliers by setting an industry-wide standard; members work with a common set of guidelines,
which is consistently messaged to suppliers.
Another project that is unlikely to be impactful with one company alone is a dashboard that
companies and suppliers can use to plan, track, or project emissions reductions. Novartis (EDF
6. Business travel 1. Reduce the amount of business travel (e.g., encourage video)
2. Encourage more efficient modes of travel (e.g., rail instead of plane)
7. Employee
commuting
1. Reduce commuting distance and number of days worked per week
2. Dis-incentivize car commuting and incentivize use of public transit and carpooling
3. Implement teleworking/telecommuting programs
8. Upstream leased
assets
1. Increase energy efficiency of operations
2. Shift toward lower-emitting fuel sources
9. Transportation and
distribution of sold
products
1. Reduce distance between supplier and customer
2. Optimize efficiency of transportation and distribution
3. Replace higher emitting transportation modes with lower emitting ones
10. Processing of sold
products
1. Improve efficiency of processing
2. Redesign products to reduce processing required
3. Use lower-GHG energy sources
11. Use of sold
products
1. Shift away from products that contain or emit GHGs
2. Decrease the use-phase GHG intensity of product portfolio
3. Change user instructions to promote efficient product use
12. End-of-life
treatment of sold
products
1. Make products recyclable if it leads to net GHG reductions
2. Implement product packaging measures that lead to net GHG reductions
3. Implement recycling measures that lead to net GHG reductions
13. Downstream
leased assets
1. Increase energy efficiency of operations
2. Shift toward lower-emitting fuel sources
14. Franchises 1. Increase energy efficiency of operations and shift to lower-emitting fuel sources
15. Investments 1. Invest in lower-emitting investments, technologies, and projects
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Appendix 2: Literature and Industry Review a) Third-Party Knowledge-Sharing and Consensus-Building Programs
• The Science Based Target Initiative (SBTi)—created by CDP, the World Resources Institute
(WRI), the UN Global Compact, and the World Wildlife Fund (WWF)—manages the SBTs.
Biogen worked with the SBTi to set targets in line with the Paris Agreement (SBTi, 2018). It
also holds regular webinars and publishes case studies on companies pursuing SBTs.
• RE100, a global collaborative initiative of CDP and The Climate Group (that Biogen has
already joined), recently published guidance for companies to increase green power in their
supply chains (RE100, 2017).
• The EPA’s Center for Corporate Climate Leadership encourages and assists organizations
in identifying and achieving cost-effective GHG emissions reductions and also drives
innovations in reducing supply chain emissions (EPA, 2018).
• The NGO CERES maintains a Company Network and Roadmap for Sustainability to promote
and assist in corporate leadership in areas like supply chain and logistics (Ceres, 2017).
• The GHG Protocol a World Resources Institute (WRI) and World Business Council on
Sustainable Development (WBCSD) initiative, maintains resources to help organizations
understand, measure, and report emissions, including the Scope 3 Standard (GHG Protocol,
2018).
b) Third-Party Organizations to Refine and Implement a Scope 3 Strategy • The consultancy Trucost, now owned by S&P Global, helps companies like Biogen measure
environmental and social impacts across supply chains by combining purchasing data with
their proprietary supplier and industry data (Trucost, 2018b).
• The consultancy Carbon Trust helps clients like Mahindra Sanyo and Carlsberg set SBTs,
provides strategic advice on how to achieve them, and assists with reporting (Carbon Trust,
2017 & 2018). They also offer services to engage suppliers and set procurement standards.
• The sustainability consultant Quantis assists clients in developing climate roadmaps and
action plans to effectively and efficiently reach their SBTs (Quantis, 2017).
• Thinkstep is a consultancy that assists companies in setting their SBTs and then develop and
implement strategies to achieve them (Thinkstep, 2018a). Thinkstep has also developed
software to calculate companies’ water, carbon, and land-use footprints throughout their own
operations and those of their suppliers.
• Ecofys, a Navigant Company, works with companies like J&J and Tetra Pak to develop
strategies to set and achieve SBTs (Ecofys, 2018).
c) Case Studies from Other Industries Alcatel-Lucent – scaling up an industry collaboration throughout the information communication
technology sector (ICT):
The ICT industry has demonstrated a commitment to GHG emissions reductions through industry
collaboration. Alcatel-Lucent worked with ICT companies and external experts to create a large-
scale solution. The CEO tasked the company’s Bell Labs with assessing how Alcatel-Lucent could
tackle climate challenges. Applying the results, Alcatel-Lucent brought in the wider industry
including industry leaders and academic, public sector, and NGO experts to reach the goal of
improving energy efficiency of communication networks by a factor of 1,000 by 2015 compared
to a 2010 baseline (UN Global Compact, et al., 2013). In 2013, the consortium had reached 90
44
percent of the goal. Alcatel-Lucent took the lead of previous action-based industry collaborations.
In 2008, the Global e-Sustainability Initiative (GeSI), The Climate Group, and a partnership of
ICT companies assessed the future of the industry (UN Global Compact, et.al, 2013). Their
analyses provided a goal for the sector to reduce emissions through energy efficiency measures by
2020 (The Climate Group & GeSI, 2008). The report also outlined policy barriers and incentives,
which companies adopted and championed in their policy engagement. Some companies further
worked together to release a report articulating the policy action needed to reach the GHG
emissions reductions and also described examples of initiatives that could create economic and
environmental benefits.
Apple – direct supplier energy efficiency and renewable energy support:
Apple launched a supplier Energy Efficiency Program in 2015 to train suppliers to increase
efficiencies and reduce carbon emissions (first focusing on the highest energy users) and now
requires each of its supplier to set carbon reduction goals (Apple, 2018). Suppliers are given in-
depth energy assessments with cost benefit analyses for energy efficiency and green power
investments. Through its Supplier Clean Energy Program, Apple will help its suppliers procure
over 4 gigawatts (GW) of green power worldwide by 2020. As a part of this program, Apple
maintains a Clean Energy Portal, an online platform that offers regional guidance and tools to
procure renewable energy, in which over 100 of its suppliers have participated. As of April 2019,
44 of Apple’s suppliers have committed to run their Apple production on 100 percent renewables
(Apple, 2019). In China, the company also created a Clean Energy Fund, which aggregates the
energy load across ten of its suppliers in Chinesa to take advantage of greater purchasing power to
procure green power (Fulton, 2018).
Cisco – employee education and engagement:
Cisco uses many employee education and engagement activities described in Supplement 1:
Employee Education, including green teams throughout its various global sites. Green teams help
move sustainability goals forward by enabling employees to take ownership of creating and
implementing initiatives and encouraging healthy competition between the sites. For example,
Cisco has a goal of using electricity generated from renewable sources for at least 85 percent of its
global electricity and its Research Triangle Park (RTP) site has been boasting about it trajectory
in reaching this goal, which is drumming up healthy competition from other Cisco sites to beat
RTP in achieving this target (Personal Communication, Jordan Hart-White, February 8, 2019).
Cisco also hosts Earth Aware, a month-long sustainability volunteerism and awareness campaign
during which employees take part in seminars, trainings, and volunteer activities. The campaign
culminates with SustainX, a large conference that brings in different companies to speak about
what sustainability means to them and promotes collaboration.
Clif Bar – green power consulting services for suppliers:
Since Clif Bar began tracking supply chain emissions in 2002, it quickly realized that most of its
emissions lived within scope 3. To be able to guide its suppliers to do the same, Clif Bar began
purchasing offsets equal to 100 percent of its emissions in 2003 and procured green power for each
new facility it constructed (EPA, 2016). In 2014, Clif Bar launched the 50/50 by 2020 program for
50 suppliers to transition to 50 percent or more green power by 2020 (Clif Bar, 2017). Realizing
that most of its suppliers would require assistance, Clif Bar began paying for independent energy
experts to help suppliers assess their options to install on-site systems or procure other forms of
45
renewable electricity. More than 90 percent of Clif Bar’s suppliers that have taken advantage of
these consulting services have procured green power. Furthermore, in March 2019, Clif Bar
created a multimillion-dollar AgFund to help its organic farmer suppliers become more climate
resilient, which includes helping them host wind turbines on their properties (GreenBiz, 2019).
Many of its suppliers now share best practices at Clif Bar’s annual supplier summit and are
formally recognized by the company.
Levi Strauss & Co. – supplier energy efficiency and renewable energy advisory services:
In 2018, Levi’s set an SBT to reduce supplier emissions (scope 3 category 1) by 40 percent by
2025 on an absolute basis (Levi Strauss, 2018). To achieve this lofty goal, the company has formed
two key partnerships: The Clean by Design Program with the Natural Resources Defense Council
(Murray, 2016) and the Partnership for Cleaner Textiles (PaCT) with the International Finance
Corporation (IFC) of the Word Bank (PaCT, 2018). Through the Clean by Design Program, a
group of experts created a best practice manual for 12 participating textile mills, resulting in
millions of dollars of annual energy savings. Additionally, through PaCT, suppliers receive access
to advisory services (25% of the costs are paid by the supplier, 25% by Levi’s, and 50% by IFC)
and low-cost financing for water, energy efficiency, and renewable energy projects. In the first
year of the program, participating suppliers each reduced emissions by an average of 20 percent.
Suppliers that perform well on Levi’s supplier code of conduct also have access to free renewable
energy assessments and competitively-priced financing for renewable energy projects if they
decide to pursue them.
Nike – working with its suppliers to reduce impacts:
Through its Environment Minimum Programs, Nike works with suppliers to understand their
impact areas, and develop and implement new practices to improve their performance, including
energy usage and carbon emissions (Nike, 2017). The company shares data collection and
reporting tools with its suppliers and holds training programs to help them minimize their
environmental footprints. Nike’s procurement team makes sustainability an expectation and views
energy savings as an efficiency issue, which could affect future business with the company if
expectations are not met (C. Greenwood, personal communication, December 14, 2018). Nike also
works with Washington State University to develop capabilities, energy toolsets, and best practices
to help suppliers become more energy efficient.
Sustainable Apparel Coalition (SAC) – using combined buying power to influence suppliers:
The SAC is the apparel, footwear, and textile industry’s self-described leading alliance for
sustainable production (SAC, 2018). The SAC was formed because the apparel industry is carbon
intensive and each individual company often only has a small portion of each supplier’s total
business (like the pharmaceutical industry). By banding together as an industry, SAC members,
with a combined annual revenue of over $500 billion (similar to U.S. pharmaceutical sales) can
both pool their resources and assert greater leverage over common suppliers. One of the SAC’s
most valuable tools is the Higg Index, which is a suite of tools that allows companies throughout
the apparel coalition to accurately assess a supplier company’s, product’s, or material’s
sustainability performance in order for companies to make informed decisions.
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Together for Sustainability (TfS) – common supplier evaluations and data-sharing:
TfS is a broad chemical industry sustainability collaboration made up of 22 multinational chemical
companies (TfS, 2018). The collaboration has developed and implemented a program to assess,
audit, and improve the global chemical supply chain (EY & UN Global Compact, 2016). The more
than 10,000 supplier evaluations that have been carried out using Ecovadis, in addition to the 1,200
independent audits, is available to all member organizations. The TfS website also allows for the
sharing of best practices among members and suppliers and allows suppliers to compare their
efforts to other suppliers.
Unilever – incorporating sustainability into manager training:
Unilever’s top 500 managers go through an intensive leadership development process. As part of
the process, the most senior executives generate and present a “Purpose Into Impact” project. These
projects draw on the company’s sense of personal purpose to deliver societal and business impact.
The executives must choose one of Unilever’s most material sustainability challenges, such as
water scarcity or sustainable sourcing, and work in groups to develop solutions. The solutions are
then presented back to the top leaders in the business. In addition to senior executives, Unilever
has also integrated sustainability into existing training for other managers. For instance, all new
brand managers spend a week on a sustainability marketing challenge (Bhattacharya & Polman,
2016).
Walmart – a comprehensive, industry-leading supplier emissions reduction program:
Working with the external groups WWF, EDF, CDP, BSR, and TSC, Project Gigaton was created
in 2017 to avoid a gigaton (a billion tons) of greenhouse gas emissions throughout its value chain
by 2030 (Walmart, 2018a). Project Gigaton is the scope 3 component of Walmart’s SBT. Suppliers
who want to join have to first set an emissions reduction goal, then sign up on Walmart’s online
Sustainability Hub and report their emissions reductions each year. As of April 2019, over 1,000
suppliers had signed on and those participating receive public recognition and have access to a
variety of tools and resources on the Hub. While Walmart’s energy and sustainability staff can
assist suppliers in reducing their emissions, Walmart will not offer longer-term contracts to
suppliers just because they pursue sustainability. Walmart believes cost savings from reducing
energy use alone should provide enough incentive for suppliers (K. Canoy, personal
communication, October 5, 2018). Sustainability is just one of many considerations Walmart’s
procurement team uses, but the company hopes that by having the conversation with suppliers and
by showing the value of its own sustainability efforts, suppliers will make improvements. Project
Gigaton’s scope 3 data collection process is led by TSC, which works with suppliers to improve
their carbon emissions (TSC, 2017). TSC also maintains Walmart’s Sustainability Index, which
tracks suppliers’ efforts to improve product sustainability performance across over 100 categories
(Walmart, 2018b).
d) Industry Case Studies Abbott – improving product packaging:
Abbott was guided by the four R’s: reduce – optimize packaging design to reduce material use;
renew – source packaging from renewable materials; recycle – improve the use of recycled content
and expand the use of recyclable packaging; reuse – design packaging to allow reuse opportunities.
They redesigned multipack carriers for nutritional bottles, which improves consumer convenience
and reduces the weight of plastic carriers by more than 50 percent. This has eliminated more than
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700,000 pounds of packaging on an annual basis. Since 2010, Abbott has reduced the amount of
waste sent to landfill by 42 percent (CDP, 2017).
Bayer – sustainability audits and third-party organizations:
In addition to assessing approximately 2,000 suppliers using Ecovadis, Bayer conducted supplier
audits around the globe. Internal auditors completed almost 200 audits of suppliers focusing on
EHS criteria. External auditors such as TfS and PSCI conducted shared sustainability audits
supplier audits and reached out to suppliers via supplier events. During the audits and supplier
engagement, Bayer identified 1.3 percent that had a “critical” result and these companies were
asked to correct these measures. Almost a year later, 40 percent of the re-assessed suppliers
improved the critical area (CDP, 2017).
Daiichi Sankyo – gathering thorough information on supplier emissions:
Daiichi Sankyo asks its suppliers and partners (third-party logistics providers, etc.) to understand
the Daiichi Sankyo group Environmental Management policy and CSR Procurement Policy. The
company engaged 95 percent of total spend, or 150 companies. Daiichi Sankyo holds meetings
with them routinely to share the information about GHG emissions and engage the implementation
of Daiichi Sankyo’s policy and action plan. It also collects information about GHG emissions
reductions, reductions in procurement risk, cost reductions, and status to reach goals. Daiichi
Sankyo aims for 90 percent of their key suppliers (by purchase value) to establish GHG reduction
targets by 2020 (CDP, 2017).
GSK – engaging suppliers through online dashboards:
GSK collaborates with suppliers online via its “GSK Supplier Exchange.” The Exchange is an
online forum for sharing ideas about things like improving energy efficiency. Suppliers have
access to this information to reduce the impact of their operations. GSK tracks the number of
suppliers engaged on the Exchange as a metric for success. Around 350 suppliers are engaged via
the GSK Supplier exchange. GSK is using the information from the Exchange to identify suppliers
and prioritize energy reduction events on-site for suppliers. According to GSK, each of these
workshops typically identifies CO2e emissions reduction opportunities of 5,000 tons CO2e (CDP,
2017).
GSK – aligning actions to climate policy:
GSK has made enormous efforts to ensure alignment between its public position on climate change
and its company actions. In 2013, the GSK’s Corporate Responsibility Committee asked the
company’s Audit and Assurance Group “to review internal processes and risk to company
reputation surrounding public commitments, including those relating to climate change” (UN
Global Compact, et.al, 2013). As a result, GSK developed the Supplier Exchange. Around 350
suppliers are engaged via the GSK Supplier Exchange online forum for collaboration to share
practical ideas about improving energy efficiency, reducing water use and reducing waste.
Suppliers have used this insight to make improvements to their operations (CDP, 2017).
Novartis – engaging employees in sustainability initiatives:
Novartis uses many employee education and engagement activities described in Supplement 1:
Employee Education. Novartis formally recognizes employees in its awards programs. Novartis
rewards associates who develop energy saving, renewable energy, or environmental projects such
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as water footprint, sustainable packaging, or waste and emissions reductions. In addition, the
company fosters innovation among employees; all employees can submit innovative projects or
ideas to improve energy efficiency and reduce GHG emissions to the Novartis Health, Safety,
Environment, and Business Continuity (HSE&BC) Excellence Award scheme. The winners are
judged by an internal panel of experts. The winning projects are funded and implemented (CDP,
2017).
Novo Nordisk – supporting renewable energy in the supply chain:
Novo Nordisk engaged directly with eight suppliers in 2016. In this effort the company encouraged
suppliers to invest in and purchase renewable energy. Two suppliers had a three-day supplier visit
by two energy experts, helping them to identify energy efficiency projects. The suppliers were
selected based on their specific needs and maturity. One supplier was offered support for an energy
efficient design of their new facility. Novo Nordisk shared their documents and guidance based on
industry and experience (CDP, 2017).
Novo Nordisk – educate company on SBT:
Novo Nordisk uses its “Blueprint for Change” for major issues affecting its future. It uses this tool
to create coherent strategies and help in “measuring realized benefits for both society and the
organization and sharing this information” with stakeholders (UN Global Compact, et al., 2013).
Novo Nordisk seeks to match its “Blueprint” on climate change with actions, so has engaged with
external partners such as WWF to do so. This includes mainstreaming sustainability goals
throughout the company, working with suppliers that have emissions reductions goals, and
adhering to the timeline it has set for reaching its SBTs. It also created partnerships to promote
clean energy resources. For instance, to promote clean energy incentives, it strategically partnered
with Chinese officials to increase focus on renewable energy around the company’s production
site in Tianjin, China. In 2013, Novo Nordisk signed a Memorandum of Understanding (MOU)
with Tianjin Economic-Technological Development Area to achieve this goal (UN Global
Compact, et al., 2013).
e) Industry Resources Industry Database
In addition to the case studies, the efforts and goals of suppliers and competitors were put into an
industry database Excel file. The data that populates the spreadsheet are from CDP 2017 responses
that are self-reported from the companies. Biogen can use this database to create instant, printable
profiles when making decisions regarding applications of recommendations. An example showing
Biogen’s, AstraZeneca’s, and Omnicare’s profiles are shown in Figure 11.
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Figure 11 Examples from the Industry Database spreadsheet showing Biogen’s, AstraZeneca’s, and Omnicare’s profiles
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Competitor Benchmarking
Table 4 provides a summary of what Biogen’s competitors are doing to reduce GHG emissions.
This information is a condensed version of what is available in the database. Biogen should use
this information when benchmarking itself against competitors.
Table 4 Competitor Benchmarking
Competitor SBT as if 2018 CDP CC3 Absolute Emissions Reduction Goal as of 2017
Biogen Scope 1, 2, 3 by 35 percent 2013-
2030
Ongoing commitment to Carbon Neutrality; Supplier
Engagement on Climate Change - In 2016, Biogen engaged
(gathered more emissions information) with its top 50
suppliers from a carbon emission and spend perspective,
which collectively represented about 75 percent of Biogen’s